Michigan

TrackSpeed finds a new niche

Tina Reed | The Ann Arbor NewsTrackSpeed chief executive officer Brent Ray, left, says the local software company helps other companies sell their obsolete or surplus inventory through an online auction service. The company creates programs to help manufacturers track inventory and equipment. It is expanding internationally because of its success with its SurplusTrack service.

Ann Arbor's TrackSpeed LLC started five years ago as a Web-based software company helping large manufacturers keep track of equipment and inventory.

But in 2006, the company discovered its niche: helping those companies - many consolidating or restructuring in a struggling economy - make money on their surplus or obsolete equipment and inventory.

Calling their Web-based service SurplusTrack, the company stores, photographs and sells those surplus materials in an eBay-like auction portion of its Web site to other manufacturers.

It's been so successful that the company is adding locations internationally and adding some local jobs to keep up, said president and chief executive officer Brent Ray.

This week, the company planned to open operations in Ontario, and plans are in the works to open a location in Monterey, Mexico, by September. Earlier this month, TrackSpeed moved its warehouse from its 6,500-square-foot headquarters in Ann Arbor to a 70,000-square-foot location in Brownstown Township.

It stores equipment there that might have been tossed out or sold for scrap value, Ray said.

"We like to say one of our biggest competitors is the Dumpster," Ray said.

The company brought in barely $100,000 in revenue during its first year of business, but Ray anticipates bringing in more than $3 million this year - about a 16 percent growth from last year. The company is planning a buildout of its Ann Arbor headquarters and will likely add about 10 jobs there, mostly software design.

"We've had a lot of companies find us and tell us ... we're cheaper than their distributor," Ray said. "We're helping their bottom line."

One such company is Champion Laboratories Inc., which manufactures filters for cars and larger, industrial vehicles. The company has about $1.5 million in surplus and obsolete inventory it expects to sell through the service that would have otherwise been stored, said Mary Blair, Champion's vice president for global procurement.

"It sat on our budget as a dollar value against the company's budget because it wasn't being used," Blair said. "You put it up there and think, 'No one would ever buy this.' But they do."